Thursday, 20 November 2014

A retailer’s life is literally 24 X 7 X 365

A retailer’s life is literally 24 X 7 X 365 It is therefore important to stay fit and healthy and to ensure that you and your family are protected in the unlikely event something goes wrong either in the business or in your health. One decision I took when I started Guardian was that I have to remain fit and healthy. I could not afford to fall sick and therefore I would have to “will” myself into staying healthy. I had started my entrepreneurial journey at a very late age in life and I definitely could not afford to fall sick or do anything that would jeopardise my health. I was betting my career, my family’s future and my entire credibility on this venture and there was no way that I could fall sick and stall my journey before I had achieved what I had set out to do. Manage personal health well Work pressure while building any new business will be very intense and an entrepreneur has very few choices except to stay well and stay fit. He needs to build the stamina to keep going, in the face of all possible adversity. Falling sick is not an option that can be considered. There will be many moments when every entrepreneur wants to throw in the towel simply because the stress becomes unbearable yet unlike any other individual, it is important for an entrepreneur to keep going because the light at the end of the tunnel is the achievement of his dream. No matter how much stress you may carry inside you, it is very important to “appear” absolutely calm from the outside. With a regular exercise regime and reasonable diet control, along with appropriate medication, I have managed to control both my blood pressure and my diabetes levels within acceptable levels. Ensure you follow a daily routine When I started off on my journey, I knew that I was overweight and I also recognised that excess weight was the cause for a number of illnesses. My body, like the bodies of so many obese and overweight people, was not designed to handle so many extra kilos of weight. As the weather in Delhi cooled down in November every year, I would find that my eosinophilia count increase because of the increased pollen grains in the atmosphere which would lead to wheezing and asthma. My inhaler was my constant companion throughout the winter months of Delhi. This was always very debilitating and would invariably make me take forced rest at home for a few days every winter. I knew I had to stop this I started on a strict regimen of exercise, diet. Till today, I take at least five vitamin supplements every day – one tablet each of vitamin C, multi vitamin, fish body oil, glucosamine and co enzyme Q 10. In addition, I am always the first person to experiment with the various vitamins that we have been launching under the Guardian brand name. Lose weight if you know that you need to I knew I had to lose at least 10 kilos. I had never been an “exercise person” or a sports person. However, I willed myself into walking at least six kilometers in one hour at least six days a week. I have now got into a habit of exercising every day and the day I do not work out is terrible since I miss my exercise. What worked for me was when I started cutting down on my food intake combined with regular exercise. It was only through diet control that I managed to lose almost fourteen kilos of weight in about three. My exercise helped my body to stay fit and the cardio vascular exercises helped in controlling my blood pressure. I am not sure if it was the exercise, the weight loss, the vitamins or simply the adrenalin rush from building a new company or a combination of one or more of these that has helped me to stay healthy and fit. What that I do know and see is that over the last seven years, I have not fallen sick for a single day, not even with the common flu. I was mildly asthmatic especially in November each year when the atmosphere was full of pollen grains but I have thrown away my inhaler and my wheezing is a thing of the past. My blood pressure is under control, my cholesterol levels are at an enviable 150 and my blood sugar is marginally high! Don’t let your Mind give up So many battles are won or lost if the mind accepts defeat or gives up too easily. When I chat with entrepreneurs who started and stopped or professionals who gave up the “joys” of a corporate battle for supremacy, I know that they gave up the fight because they had not built the internal resilience in their own minds to stay the course. Like a game of golf where one plays much better golf when one’s mind is at rest, success and failure is also all in one’s mind. I have found that giving up is very easy and several times in my own journey both as a professional as well as an entrepreneur, I have had the temptation to give up and call it a day because all choices seemed to be tough and insurmountable. As I look back at my life, I wonder what kind of a person I would have been had I given up each time my body told me to stop and my mind forced me to carry on. Every entrepreneur must develop mental strength take on tough tasks and select from equally tough choices. Yet the joy of achieving a task that seemed impossible also gives it own high. Don’t lose sight of your personal life As a professional manager, I always encouraged my colleagues to take leave every year. Whenever someone told me that he was working over twelve hours per day on a regular basis, my response to him was simply “If you cannot finish your allotted work in office timings, you are either over worked and need an assistant or very inefficient” Similarly, when someone told me that he had not taken any leave for so many years, my response to such people was “You have not done the company a favour. I would like you to take your leave and come back to work rejuvenated”. I have never refused any manager his leave whenever he has asked for leave. I have often spoken to entrepreneurs who tell me that they don’t have the time to take a vacation and I have never believed any of them. My response to them would be no different from my response to professional managers. I have also followed a practice of not working long hours at work. If a person cannot take time off for himself and give his mind and body a rest, then there is a problem brewing in the long run for such an individual. It is important for every individual to take time off and spend time with one’s family. Build internal resilience and stay calm It is very important for anyone embarking on any journey to build strong internal resilience. A number of times people fail to complete their journey because they give up too early. For me giving up has never been an option. I have believed in leaning into the storm rather than running away from it. Every entrepreneur has to develop a “thick skin” and learn to accept all kinds of comments about himself and his company. Developing the ability to stay calm in the face of adversity is an important quality I learned to develop very early in my working life and this has served me well. The author is the Chairman of Guardian Pharmacies and the author of the bestselling books, The Buck Stops Here and The Corner Office. Twitter: @gargashutosh

Thursday, 6 November 2014

Franchising Basics: Everything That Prospective Indian Franchisees Should Know

For most retail businesses, franchising offers an excellent opportunity to grow the brand across a large geographical territory very quickly. Opening up a company’s systems and its heart to an individual who wants to come on board primarily because he senses a financial return on his investment takes an organisation time to understand and digest. It is essential to make sure that a company embarks on franchising only when the organisation and its people are ready to welcome a franchisee into its fold. Benefits of franchising From the perspective of a franchisee, it is important to understand what benefits he can expect and from the perspective of a franchisor, they must understand that they must be able to provide value to any potential franchisee. 1. Consumers buy from brands they trust – Brands are what convey credibility to a consumer and brands outlive any promoter or manager. A strong brand ensures long term profits and an association with a strong and credible franchisor helps to build a long term and sustainable business for an investor. The franchisor must support his brand and the franchisee must assure the brand owner that the brand will be respected and that no steps would ever be taken that will tarnish the image or diminish the value of the brand. 2. Efficient business practices as systems are proven – Strong companies are able to bring strong systems and good business practices into the business of any franchisee. It is important to adhere to these values to ensure that there is no clash of values between the franchisor and the franchisee. 3. Marketing costs are lower through volume – Becoming a member of a large franchise operation helps to defray marketing costs over a large number of business owners. 4. Mentoring the franchisees – The franchisor must put together a senior team that is available to mentor all franchisees through their early stage of taking the franchise. This mentoring is really an extract of all the learnings of the company over a period of time through experience. 5. Reduced risk through proven business model – The franchisor must believe that the learnings of the franchisor can be transferred to a potential franchisee so that his learning curve is not as steep or as expensive as that of the franchisor. 6. Defined territories protect franchisees from competition – Once a franchise territory has been defined, it becomes a valuable piece of “real estate” since there should be no other franchisee in this defined territory. Franchisor Checklist A franchisor must look at what he can to offer to a potential franchisee before agreeing to sign up and give the rights to their brand to any franchisee. 1. Strong Value Proposition – the brand proposed to be franchised must offer a strong, clear and unambiguous value proposition to the potential franchisee. 2. Control Systems – The franchisor must have strong back office and control systems to help a franchisee manage his business as well for the franchisor to manage several franchisees. 3. Buy in from everyone within the company – Getting a buy in from every department and every head of department is essential for the process to work. The franchisor must create a dedicated team of people who will be able to address the issues faced by any franchisee. 4. Business Plan – The franchisor must not prepare or commit to a business plan for any franchisee. All that he should do is to give the assumptions for preparing a business plan and share all the relevant data from their company owned operations in a similar market. The business has to be run by the franchisee and they have to commit to their numbers, not the franchisor. 5. Don’t differentiate from company owned store – Franchisee operations have the same needs as those of a company owned operations and the franchisor cannot afford to differentiate between these. This problem becomes more acute at the field level where issues start between the two formats. Such issues need to be tackled immediately before these become serious problems. From a customer’s perspective, the franchisor must remember that there is no differentiation and if there is a problem in service delivery, the franchisor cannot tell the consumer “The problem occurred because of the franchisee”! Franchisee Checklist Before an individual takes up a franchise of any brand, he must address the following questions to his satisfaction. Once money is committed, then it is very difficult to change one’s mind. 1. Is this the right franchise for you – Every franchisee should ask himself the question whether he has the skills or the training to handle the chosen business. I have met a number of potential franchisees who assume that they simply have to make an investment and then wait for the results. When I tell them that they have to actually run their business and not simply make an investment, they start to think twice. 2. Get professional advice from an accountant, lawyer or other business expert – I always ask a potential franchisee to develop a business plan before they start making the investment. Unless a franchisee understands his own business model, he will never be able to extract the maximum value for his franchise in terms of monthly returns after meeting all his costs. 3. Check out the franchisor – It is the responsibility of the franchisor to give a detailed data pack to every potential franchisee to conduct a detailed due diligence on the company and its directors. This is important so that a person who wants to invest money satisfies himself about the franchisor and people behind the company. 4. Speak with existing franchisees – Potential franchisees must be encouraged to meet and discuss the franchisor experience with other franchisees. Only when they hear a satisfied franchisee speaking will they understand the value they can get for themselves from the brand and organisation they may choose to partner with. 5. What is the exit strategy and what goodwill can be retained? – For every potential franchisee, the franchisor must offer an exit by offering to buy out the franchise at the end of the agreed period. If the franchisee wishes to continue longer, the renewal should be on terms then applicable.